Observation is sometimes the only method possible : for instance, if we do not want to warn the individuals being observed because we are afraid of causing modifications in their behaviour, or in the case of cultural differences where the language separates the observer from the observed etc
Observation easily fits into (possibly at several levels) a collection method because it shows up the frequent gaps between what people say and what they do, the big differences between, on the one hand the opinions, attitude, intentions and on the other hand the real conduct.
Assignment of immersion and observation at a given place (commercial, tourism etc.), it can be :
To analyse « vast » subjects : wide thematic areas or very intimate subjects that are difficult to speak about, or the assessment of habits of which one is very little aware (customer experience, way of doing the washing up etc.)